I think there is a nuance going on there with respect to the availability of transportation. One of the things that we saw over the last couple of years was just a real shortage of trucking capacity. And I think that put a little bit of an uplift on pricing just as mills, particularly strong lumber markets. We’re making sure that they had adequate log decks as that trucking capacity has loosened a little bit. I think some of that pressure has come off. As we think about where we are in the year, it’s not a typical to see a little downward pressure on log prices just because in the summer months, and the drier weather, you have more supply hitting the market. So that’s the dynamic at play. I do think over time and again, just going back to my point earlier, as we see capacity continuing to come into the region you are going to see continued pressure and tensioning across the South.
So I think the trajectory is still what we had expected. And certainly, I think we’re optimistic over the next several years as these mills continue to come into the region that you’ll see continued upward price pressure. You’ll have ups and downs seasonally like we always do, but the overall trajectory, I think, still looks positive. With respect to your question around EWP, I think if you really want to understand what’s going on today, you have to look back a couple of quarters and just think about the trajectory of what’s happened. As we got into late last year and early 2023, we had a fair bit of destocking going on. So you combine that with the lower residential construction activity and it really put the EWP market in a softer place earlier in this year.
And so that was really the story in Q1. As you remember, we did dial back our production in EWP to address that. I think we have a pretty good customer base. We have a strong product. And so as that market started to recover, there was good demand for our product. And we certainly saw that over the course of Q2 moving into Q3, but the reality is, in Q1 and Q2, just as those markets rebalanced, we had to take pricing action as everyone else did, just to make sure that we were competitive in each individual market. There’s generally a time lag in terms of those pricing actions, whether you’re raising prices or lowering prices. And so some of what you’re seeing in Q3 is just the lag effect of pricing actions that we had to take earlier in the year.
I would say, on balance, the market is recovering nicely. Our order files are back to the place where they’re fairly extended. We’re even on allocation for a few products at this point. So the market is stabilizing, but each individual market has its own dynamics, and we’ll make pricing action where necessary to make sure we’re competitive. But I think directionally, we feel pretty good about where EWP is and the trends that we’ve seen lately.
George Staphos: Thank you, Devin.
Operator: Our next question is from Kurt Yinger with D.A. Davidson. Please proceed with your question.
Kurt Yinger: Great. Thanks and good morning everyone.
Devin Stockfish: Good morning.
David Wold: Good morning.
Kurt Yinger: I know it wasn’t a huge impact for you guys in the quarter, but could you just talk about some of the derivative impacts from the wildfires up in Canada in terms of just operating your facilities there, logistics and transportation and the role that has perhaps played in some of the pricing strength that we’ve seen in the last two to three months?
